GM reports $1.1 billion loss as sales sink, costs rise

[Analog]

DETROIT-- General Motors Corp. lost $1.1 billion or $1.95 per share in the first quarter of this year as the automaker was hit with sliding sales in North America and rising health care costs. It's the company's worst quarterly loss since first quarter of 1992.

Excluding the effect of $265 million in special items, GM lost $839 million or $1.48 per share in the first quarter, just beating Wall Street expectations of a $1.49 per share loss.

Revenues for the period fell 4.3 percent to $45.8 billion

During the first quarter of 2004, GM earned $1.2 billion or $2.25 per share.

GM's North American operations dragged down its bottom line losing $1.3 billion in the quarter compared with a $401 million profit last year.

Through March, GM has seen its U.S. market share slide to 25.6 percent from 6.8 percent a year ago. Sales are down 5.1 percent.

"While most of our business units exceeded expectations, the results at GM North America were clearly disappointing," said GM chairman and CEO Rick Wagoner in a statement.

GMAC, the company's finance unit, earned $728 million in the quarter compared with $764 million last year.
http://www.detnews.com/2005/autosinsider/0504/19/A01-155362.htm

 

[WT]

You cannot introduce an entirely new model line across the board like they did and not expect to have a letdown. The golden rule when car shopping has always been .. do not buy the first model year of any vehicle, let them work the bugs out first. They needed the facelift, but still really went overboard. Its not looking good for either Ford or Chevrolet lately.

 

[JulesMaximus]

Originally posted by: WT
You cannot introduce an entirely new model line across the board like they did and not expect to have a letdown. The golden rule when car shopping has always been .. do not buy the first model year of any vehicle, let them work the bugs out first. They needed the facelift, but still really went overboard. Its not looking good for either Ford or Chevrolet lately.

Trouble is most of their new cars look like ass.

 

[iversonyin]

as expected....

 

[CombatChuk]

Not suprising considering the lukewarm reactions to the new cars;

Cobalt
G6
LaCrosse

My guess that the finance division lost money was due to all the 0% financing deals they offer to move the cars.

 

[brtspears2]

I heard GM spends six billion dollars on healthcare a year. True?

 

[iversonyin]

Originally posted by: brtspears2
I heard GM spends six billion dollars on healthcare a year. True?

not so sure....they do have load of worker comp on their liability column.

 

[alent1234]

I just did a paper for school and the topic was GM's current problems. I forgot the final figure, but it's $1525 per vehicle. The unionized people pay 7% of their costs, the salaried people 27%. The average in the US is 32%. 1/3 of GM's unionized workforce is obese and this costs them $286 million per year in additional expenditures. They spend a ton of money on lifestyle drugs like Lipitor, blood pressure medicines and everything else that comes with obesity. In a lot of GM's factories it is still OK to smoke while working. In one factory there is a bar in the parking lot where the people go to drink for lunch and eat pork rinds. And of course they pay for their retirees' healthcare.

Unless the UAW comes into the real world, there will be a lot of unemployed auto workers soon

 

[JulesMaximus]

Originally posted by: CombatChuk
Not suprising considering the lukewarm reactions to the new cars;

Cobalt
G6
LaCrosse

My guess that the finance division lost money was due to all the 0% financing deals they offer to move the cars.

I think the Cobalt looks good but the rest of them are horrible. Look at that Malibu Maxx, man that thing looks horrible.

 

[ElFenix]

Originally posted by: brtspears2
I heard GM spends six billion dollars on healthcare a year. True?

its somewhere around $2000 to $2500 per car in pensions.

 

[rudder]

Originally posted by: brtspears2
I heard GM spends six billion dollars on healthcare a year. True?

They also pay 10,000+ union members full salary and benefits to not work. Costs about a $billion per year.

 

[FrustratedUser]

LOL





:Q

 

[Actaeon]

/me anxiously awaits the new Saturn Sky.

I hope a Redline version comes out shortly after!

 

[dullard]

Breaking news. GM sales down another 7% in April.

 

[GTaudiophile]

Fvck Unions and Fvck the UAW!

 

[NFS4]

Originally posted by: dullard
Breaking news. GM sales down another 7% in April.

Toyota USA Reports April 2005 Best-Ever Sales Month
Nissan North America Announces April 2005 Best Sales Ever

:laugh:

 

[Ronstang]

Originally posted by: GTaudiophile
Fvck Unions and Fvck the UAW!

Pretty much, but sadly they don't learn and will take the ship down with them. They can't afford to give up their power because any give and they basically loose all power. The Japanese and German automakers are coming into this country and setting up facilities in the south where there are NO unions and using government subsidies to kick the crap out of the US auto makers. Until the big three break the back of the UAW or simply get out of Michigan and migrate south they will continue to loose on the business end...now on the engineering and styling end only time will tell what happens there.

 

[her209]

Possible contributing factors?:

• Price
• Quality
• Use Life
• Maintenance
• Gas consumption

 

[HardcoreRobot]

its the american way for the crap to get flushed

 

[MrBond]

Use Life

I don't understand why people claim domestic cars don't last as long as their foreign counterparts. Take care of an American car, and it'll run forever (sure it's going to need parts occasionally, but what car doesn't?). My Dad has over 200,000 miles on his truck, it's about 14 model years old now. I have 157,000 on my 10 year old Blazer. My Mom and Sister both drove vehicles with over 200,000 miles on them until recently (both drive 03-04 Impala's now). I know lots of people driving 10+ year old American cars.

The truth is, there's no reason an American car purchased today won't last as long as a foreign car purchased today if you take care of them both equally. The foreign car might have more resale value after 10 years, but that's it.

 

[91TTZ]

I've said it before and I'll say it again- American corporate culture is completely oblivious to reality and isn't conducive to any type of innovation.

We used to be able to spot talent. You might have had an individual who didn't have an impressive resume, but those who did the hiring were able to spot talent when they saw it. Nowadays you have *completely clueless* HR departments doing the hiring, and they wouldn't know talent if it struck them in the head. All they can see is "buzz words" on a resume, quotas, affirmative action, policies, and procedures. These things are often counterproductive.

Even at NASA, they aren't as capable as they once were due to these reasons. You wouldn't be able to assemble a team like the had in the Apollo program anymore because it would break the rules of all types of modern hiring practices. Yet they were able to get to the Moon in 1969, and the idiots today are "hoping" they can get to the Moon in 20 years.

If the US wants to turn around, they need to re-evaluate the things they currently do. They need to ask themselves if they are succeeding in spotting talent and if their hiring practices are letting in the people they need. Because looking at sh!t like the Pontiac Aztek, Malibu Maxx, and other "innovative" American cars, it's sad to think that those designers were the best our auto companies could find.

 

[PingSpike]

91TTZ is right IMO. The Japanese automakers learned their business tactics from us. Tactics that made this country great and rich. And they play them to the hilt. The American automakers seem so bogged down with current era corporate culture horsesh|t that they're completely unable to affect any sort of change or progress. If they don't evolve in response to market stimuli, they deserve to die just like the dinosaurs.

I don't think this is just a problem with the auto industry, its a problem with almost all US companies now. They're to concerned with avoiding risk and making as much money as possible, instead of about solidifying the company's reputation and making a good product.

 

[Cleaner]

Business Week's frontpage arctile this week is on the demise of GM. GM has been losing money for years in its auto manufacturing and its finance division has been making money. I support unions and the good they have done for America in the past 100 years. However they as well as fat cat corporate america are to blame for the slide.

In terms of American cars reliability and such. I agree with MrBond. I have a 1987 Pontiac Transam with 353,000 miles on it and it still runs perfect. Original Engine. Rebuilt tranny, clutch, and water pump. That's all I've put into it. I've also got a 1993 Dodge Caravan with 200,000+ miles on it. Runs like a champ. Take care of your stuff and it will take care of you.

 

[Miramonti]

I think GM and Ford should play poker together, loser takes all.

 

[flyboy84]

Originally posted by: MrBond

Use Life

I don't understand why people claim domestic cars don't last as long as their foreign counterparts. Take care of an American car, and it'll run forever (sure it's going to need parts occasionally, but what car doesn't?). My Dad has over 200,000 miles on his truck, it's about 14 model years old now. I have 157,000 on my 10 year old Blazer. My Mom and Sister both drove vehicles with over 200,000 miles on them until recently (both drive 03-04 Impala's now). I know lots of people driving 10+ year old American cars.

The truth is, there's no reason an American car purchased today won't last as long as a foreign car purchased today if you take care of them both equally. The foreign car might have more resale value after 10 years, but that's it.

Yup my dad's got 236k on his '91 blazer...body is rusted to hell, but he babied the engine since day one and it shows.